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First Niagara quarterly profits fall 24 percent

First Niagara Financial Group reported a 24 percent drop in its second-quarter profits, as the bank prepares to be acquired by KeyCorp.

Buffalo-based First Niagara recorded net income of $46.4 million, down from $61 million a year ago. It reported operating earnings per share of 18 cents – excluding certain non-recurring costs – which topped analysts’ average estimate of 15 cents.

KeyCorp plans to complete its acquisition of First Niagara on Monday.

First Niagara said its second-quarter results were impacted by $17 million in after-tax merger integration related and restructuring charges, as well as $7 million in after-tax losses on the sale of the sale of the company’s entire high-yield energy bond exposure.

First Niagara CEO Gary Crosby said the second quarter results were “more evidence of the strength of our lending and deposit franchises.” The bank reported 5 percent year-over-year growth in average commercial loans and 6 percent growth in average transactional deposit balances.

“The First Niagara team delivered this solid performance while at the same time staying very focused on preparing for the completion of our merger with KeyCorp,” Crosby said in a statement.


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